RT Bloomberg Opinion (@opinion)@JonathanJLevin @keds_economist @AllisonSchrager “How are we getting to 2% inflation in a couple of years when [the Fed] already started cutting?” asks @AllisonSchrager.“It seems like they’ve already declared victory.”https://t.co/gpI5tkEvOw ...

Interest Rate Outlook - The market anticipates a rate cut, but the extent of the Federal Reserve's dovishness may lead to market disappointment [1] - There is considerable uncertainty and variability in expectations regarding future interest rate paths beyond the immediate cut [3] - Disagreement exists regarding the relative importance of inflation and unemployment, the two factors the Fed considers [4] Labor Market Dynamics - The market is urging the Fed to prioritize unemployment concerns and continue cutting rates [5] - Approximately 80,000 people in the US turn 65 every week, impacting the workforce denominator [6] - Companies have shifted from hoarding employees during COVID to minimizing labor costs due to rising input costs [8][9][10] - Companies are not fully passing increased costs to consumers, leading to labor cost reductions [10] - Natural attrition is occurring in the labor market due to retirements, even with companies not actively hiring [12][13] Inflationary Pressures - There are inflationary trends in the system, but companies are currently absorbing many costs [13] - Tariffs can create a multi-time inflationary effect if their costs are gradually integrated into prices over time [15]

Fed expected to cut rates for the first time this year later this afternoon. Here with us now at Post 9 is former Goldman Sachs president, current IBM vice chair Gary Conn. Gary also served as the director of the National Economic Council during President Trump's first term.Welcome back. Thanks for having great to have you, especially on a day like today. Is there scope for the market to be disappointed if if Powell isn't dovish enough to meet all their great expectations of more cuts.Look, there's there's ...

Monetary Policy & Interest Rates - The market anticipates a 0.25% interest rate cut by the Federal Reserve, influenced by signals from various Fed governors [2] - The Fed aims to loosen monetary policy to stimulate a struggling labor market, complicated by persistent inflation partly due to tariff policies [4] - The market is concerned that the Fed's independence is being undermined, potentially leading to a loss of control over inflation and impacting long-term interest rates [5] - The yield curve is steepening, indicating a decreasing difference between short-term and long-term borrowing rates, which could affect mortgage interest rates [7] Labor Market - The labor market shows signs of deterioration, with job openings falling below the number of job seekers [3] - There has been a notable increase in the black unemployment rate, signaling a potential broader weakening of the labor market [4] Tariffs & Inflation - The Trump administration's tariff policies are contributing to elevated inflation levels [4] - Uncertainty surrounding tariffs creates investment challenges, and consumer price increases may lag due to order placement and shipping times [13][14] - There is debate on whether American consumers can absorb tariff costs, considering COVID-era stimulus and elevated savings [16] Consumer Impact - Working-class individuals are facing pressure from a weakening labor market and rising prices for essential goods like groceries and housing [19] - Increased wealth from rising asset prices primarily benefits those with substantial stock market holdings and homeownership, not the majority of Americans [18]

Right now we're joined by uh Goldman Sachs, Goldman Sachs vice chairman Rob Kaplan, who's also a former Dallas Fed president. And uh Rob, what do you think about that. Just Steve's point in particular about the Fed's mortgage portfolio, what you think should be done with it.Yeah. Well, several years ago when the Fed was buying treasuries and mortgage back securities, you we discussed back then the Fed's footprint in the mortgage market was getting very very large and it was becoming a big factor and u I thi ...

The market's gearing up uh for this decision. Maybe we'll stay with this J. You want to talk over this.You can do that. >> Absolutely. Happy to do it.>> All right, let's keep looking at pictures. That's a great idea. But joining us now, and we'll get a shot of her later with her take on the market, just so you know it's really her, not someone imitating Jenny Johnson.Really is the CEO of Franklin Templeton. Has $1.6% trillion dollars in assets under management. That might be bigger than uh the UK.No, I'm ki ...

The European Central Bank has been successful at bringing inflation back to its target without choking the economy or upsetting financial markets, according to Governing Council member Yannis Stournaras https://t.co/0HVJL1Xi0g ...

Group 1 - The market is anticipating a rate cut from the Federal Reserve, with a focus on the guidance provided during the announcement [1][2] - The dot plot will be crucial in determining how many cuts are priced in for the remainder of this year and into next year, with current expectations being high [2][3] - There is uncertainty regarding the influence of new Fed governors on future guidance, which may affect market reactions [3][4] Group 2 - The handling of questions by Jerome Powell during the press conference is expected to create volatility, as there is significant uncertainty surrounding the Fed's future direction [5][6] - The dollar is projected to continue its downtrend over the coming years, which may benefit emerging markets significantly [6] - There is a growing sentiment that the current economic environment marks the end of US exceptionalism, further contributing to the dollar's decline [6] Group 3 - There is interest in obtaining Jerome Powell's personal views on inflation projections, as accountability from the Fed chair could provide clearer insights into future monetary policy [7][8] - The committee structure of the Fed allows members to avoid personal accountability, which some analysts believe could be improved by having clearer individual projections [8][9]

Federal Reserve & Interest Rates - The Federal Reserve is expected to cut interest rates by 25 basis points, marking the first cut in about a year [5] - The independence of the Federal Reserve is being challenged, particularly during the Trump term [6][8] - Concerns exist regarding political influence on the Fed, potentially impacting its decision-making process [11] - The Fed's actions significantly influence various aspects of the economy, including mortgage rates, small business loans, and grocery prices [12] - The market is closely watching the Fed's guidance on future rate cuts and the overall economic outlook [21] Economic Disparity & Retail Sales - Retail sales beat expectations in August, but spending is largely driven by the top 10% of earners [13][15] - The top 10% of earners accounted for 50% of spending in the second quarter of the year [15] - The top 10% of earners own about 90% of the stocks, benefiting significantly from stock market gains [17] - The bottom 90% are struggling with wage growth slowing down while prices increase [16] Housing Market - The average 30-year fixed-rate mortgage remains high, around 613%, similar to a year ago [22] - High mortgage rates are freezing the housing market, as people are reluctant to sell due to lower existing mortgage rates [22] TikTok Deal - A deal involving Donald Trump and US investors is nearing completion to create a new US entity to operate TikTok [24] - Concerns remain about the Chinese algorithm continuing to drive TikTok's operations [25]

Investors go into the FOMC meeting awake to the hazards of a rate cut when inflation is still a risk and stocks look overvalued, writes @johnauthers (via @opinion) https://t.co/WxeVgznbYd ...